Editorial - Portugal, Luxembourg's new satellite office?

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The news came at the beginning of the month. A press release from PwC announcing the opening of a new office… in Porto. Presented as a partnership between the Luxembourg and Portuguese entities, this new office will be essentially dedicated to the Luxembourg financial centre. In practice, this means a bunch of educated juniors, fresh from university, who will be able to work for Luxembourg on Portuguese salaries. In terms of figures, the press release mentions 250 new recruits, with a total of 700 over the next three years. So many people who will not be recruited in Luxembourg, and who will therefore not pay income tax to contribute to the local economy.

While this is probably a cost-cutting decision for the giant, it sends out the wrong signal for the financial centre and the Luxembourg economy in general. Employers' associations have been warning for years about the country's attractiveness, but it would seem that PwC's decision in any case left it with no choice but to draw on a pool of available, skilled labour. Brining 250 to 700 juniors to Luxembourg would undoubtedly be more difficult today, even if other companies of the same size manage to overcome this challenge every year. The fact remains that the talent pool has surely dried up. Universities in the Greater Region are not producing enough juniors for the financial centre, and to attract those who live far away, the carrot is probably no longer appetising enough.